Freddie Mac 2012 Annual Report Download - page 347

Table 82 — 2012 Deferred Salary
Target 2012 Deferred Salary Actual 2012 Deferred Salary
At-Risk At-Risk
Named Executive Officer Fixed
Portion Based
on Corporate
Performance
Portion Based
on Individual
Performance
Total Target
Deferred
Salary Fixed
Portion Based
on Corporate
Performance
Portion Based
on Individual
Performance
Total Actual
Deferred
Salary
Mr. Kari ............... $1,530,000 $472,500 $472,500 $2,475,000 $1,530,000 $448,875 $472,500 $2,451,375
Mr. Haldeman(1) ......... 1,440,000 405,000 405,000 2,250,000 892,800 384,750 364,500 1,642,050
Mr. Mullings ........... 658,500 229,500 229,500 1,117,500 658,500 218,025 218,025 1,094,550
Mr. Weiss ............. 891,000 297,000 297,000 1,485,000 891,000 282,150 297,000 1,470,150
Ms. Wisdom ............ 757,500 262,500 262,500 1,282,500 757,500 249,375 262,500 1,269,375
(1) All amounts reported for Mr. Haldeman are pro-rated to reflect his voluntary termination on June 30, 2012. Under the terms of the Executive
Compensation Program, Mr. Haldeman’s earned but unpaid Fixed Deferred Salary is reduced by 2% for each full or partial month by which his
termination preceded January 31, 2014. Accordingly, his Actual 2012 Fixed Deferred Salary reflects a 38% reduction from the target.
Second Installment of the 2011 Target Opportunity
Over the course of 2012, the Compensation Committee received updates from management on our achievement against
the performance objectives used to determine the funding level for the second installment of the 2011 TO. In January 2013,
management presented the Compensation Committee with its assessment that we had met or exceeded all of the objectives
for the second installment of the 2011 TO. The Committee agreed with management’s assessment of the company’s
performance against the objectives.
The table below presents the performance measures and the assessment of our achievement against those performance
objectives.
Table 83 — Achievement of Performance Measures for Second Installment of 2011 Target Opportunity
Performance Measure Weighting Key Factors Impacting Achievement Assessment
Business Infrastructure
Achieve benefit realization from key capabilities completed
and deployed through the second quarter of 2012, based on
key metrics outlined in business cases.
40% Of the three initiatives to which this objective applies, the benefit
realization exceeded expectations for one, met expectations for
another and fell short of expectations for the third, as follows:
• Cash Pipeline Management – The financial benefits of this software
application, which manages the pipeline of whole loans purchased
for cash, significantly exceeded our projections;
• Servicing Alignment Initiative – The implementation – at FHFA’s
direction – of this new set of mortgage loan servicing and
delinquency management requirements has, as expected, brought
significant benefits to borrowers and the mortgage system as a
whole.
• Multifamily Originating and Underwriting – This system will be
used to quote, underwrite and approve deals for purchase, but
adoption was delayed and benefits were below expectations.
Financial and Risk
Conserve capital by limiting the 2012 draw from Treasury
to within a range from $0 to $6 billion.
40% The Treasury draw applicable to 2012 financial results was $19
million, at the low end of the target range. In addition, we had positive
equity of $8.8 billion at December 31, 2012.
Mission
Achieve the following Mission objectives:
20% • We completed 69,581 HAMP and non-HAMP modifications, in the
middle of the target range of 55,000 – 75,000. We also completed
53,008 short sales and deed in lieu of foreclosure transactions,
above the high-end of the target range of 40,000 – 50,000.
Additionally, we purchased 434,296 HARP loans, significantly
above the high-end of the target range of 180,000 – 270,000.
• Support loss mitigation and foreclosure prevention
activities;
• Achieve the 2012 affordable housing goals; and
• Provide market support, as measured by single-family
purchases as a percentage of agency volume. • We expect to report our performance with respect to the 2012
affordable housing goals in March 2013.
• Single-family purchases as a percentage of estimated agency
volume were 26%, which was at the low end of the target range of
26%- 30%.
In evaluating the company’s performance against the performance objectives, the following additional factors were
considered in determining the appropriate funding level.
• The relatively low weighting assigned to the Multifamily Originating and Underwriting System, a business
infrastructure project for which 2012 progress was below plan;
342 Freddie Mac